News / King’s Fund: mergers not a response to financial failure

The fund examined detailed financial information on 12 hospital mergers that have taken place over the past five years. It concluded that, despite £2bn being spent, the mergers have not resolved the difficulties they were intended to address.

Most of the mergers were initiated by national regulators or special administrators with the aim of rescuing them from financial difficulty or helping them become foundations.

However, Foundation trust and NHS trust mergers – 2010 to 2015 said that most of the allocated funding was spent on writing down historic debts, covering deficits and capital investment, rather than on changing services to make the merged organisations sustainable. The fund said this suggested mergers were unlikely to address the causes of the organisations’ difficulties and are pursued as a way of securing financing that would otherwise not be available.

In September, health secretary Jeremy Hunt said there were too many trusts and he was sure that more mergers and hospital chains would be set up. However, he would not set a national blueprint to make this happen.

King’s Fund project director and author of the report Ben Collins said: ‘NHS leaders are betting the farm on time-consuming, costly and risky mergers, despite a lack of evidence that they lead to more sustainable organisations. Recent NHS history is scattered with the remains of failed, or at least profoundly troubled, mergers.’

He contrasted the £2bn spent on the 12 mergers studied with the £200m made available so far to support the new models of care being rolled out under the Five-year forward view.

‘Instead of promoting mergers,’ he said, ‘NHS leaders should focus on developing alternative solutions that address the underlying causes of the problems facing struggling hospitals.’

A forthcoming report from the fund will outline potential alternatives.

At the end of September, NHS England unveiled 13 hospital vanguards that will test three new collaborative models. In the first, top-performing trusts will form NHS foundation groups – chains of hospitals that aim to raise standards in all hospitals in the group.

In the second, multisite specialty franchises, specialists from regional centres of excellence will offer clinical services at district general hospitals. In the third model, accountable clinical networks, key services such as cancer and mental health will be integrated across district generals and teaching hospitals.